On
May 20, 1862, President Abraham Lincoln signed perhaps the greatest privatization act
in American history into law, opening 270 million acres of western lands for
private and family settlement, and dispensing to American citizens 10 percent
of the entire area of the United
States. From 1871 to 1951, 1,505,405
homestead patents were processed, and the Homestead Act provided land in
the American West until its repeal in 1976. Although distinctly a political act
of war, the Homestead Act encouraged the American dream of personal
responsibility and right to property independent of government for over 100 years.

Ever since the American War for Independence,
the distribution of unsettled frontier lands was a question as ambiguous as it
was controversial. Early American boundaries in the frontier arbitrarily
reflected odd natural landmarks, which often led to overlapping claims and
border disputes between property owners. More structural organization was
achieved with the passage of the Land Ordinance of 1785, dividing the frontier
into 6-mile square blocks of land called townships, which further subdivided
into 36 segments 1 mile (640 acres) each. These very scientific surveys were
conducted using astronomical pinpoints, revolutionizing the frontier method for
land surveying. After survey divisions were made, the government began selling
the 1-mile plots of unsettled land for $1 per acre, an outrageous price
considering inflation adjustments and the fact that uncultivated frontier land
was often arduous to prepare for farming.

By 1800, the government began halving
the plots for buyers, but the price still remained at $1.25 per acre ($15.57
in 2009 dollars). In 1854, prices were changed to be more reflective
of the value of respective properties, and plots that had been for sale for
more than five years were cut to 12.5 cents per acre.

During the
1830s and 40s, rises in corn, cotton and wheat prices favored southern
plantation owners, and displaced smaller farmers moved west for land.
Increasingly, immigrants and eastern laborers also saw the West as a land of
opportunity. However, further legislative land privatization reforms were
hindered by southern plantation owners who feared that small western farmers
would not be able to afford slaves and would be antislavery, and eastern
businesses who didn't like the loss of available workers. The Senate
accordingly voted down three separate House homestead proposals in 1852, 1854,
and 1859, respectively, and in 1860, Congress passed a land grant bill, but
President James Buchanan vetoed it.

Then came the American Civil War. By May of 1862, 11 states had left the
union, and President Lincoln was somewhat concerned about the progress
of the war. Economic resources from the West were all but necessary. General
Robert Lee's exquisite tactical leadership, combined with Lee's amazing ability
to harness the energy of those under him (Thomas Jackson for one) led the
Confederates on to victory in the east. Lincoln
feared that the Confederates would push west.

Since the Republican Party
had actually been formed in 1854 with the express platform of banning the
spread of slavery into the territories, Lincoln
had every political incentive to advance individual responsibility by providing
for homestead farming in the West. On May 20th, Congress approved and Lincoln signed the Homestead
Act in order to foster pro-Union development of the West. The Homestead Act
dispensed of free, 640-acre plots of land to those who paid the various filing
fees totaling $18, could prove with two witnesses a working farm or other
development after five years of a trial period, and who had "never
borne arms against the United States Government or given aid and comfort to
its enemies." Expressed in 2009 dollars, the Homestead Act disseminated 1-mile acre land plots for a total of $382.26. In 1800, the price for an
equivalent western holding shown in 2009 dollars would have been $9,964.80!
Where else in the world was land so affordable?

Lincoln could
not have imagined the long-term benefits of such privatization on the American
economy that reached far beyond the war. Although such individualistic farming
in the West was difficult and many homesteaders moved on to another homestead
before the five-year maturation date, the Homestead Act fostered a new era of
American personal independence and private entrepreneurship.

Homesteaders like
the Ingalls family and countless others passed their stories of hard work and
morals of family courage onto many generations of Americans, until the settling
of the West became almost fundamental to the American spirit. In 1934, the
Taylor Grazing Act significantly cut available land for homesteading, and after
over 270 million acres had been privatized, Congress finally repealed the
Homestead Act in 1976 with a 10-year extension in Alaska. Lincoln's
Homestead Act of 1862 turned out to be the greatest large scale privatization
success story in America.

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